Article

Long-Term Care Reality Check

Why long-term care insurance is a wise investment. Read more...▼

If retirement feels like a long way off, the need for long-term care might not even be on your radar. But the reality is, someone turning 65 today has almost a 70% chance of needing some form of long-term care services at some point in their lives. The cost of care adds up quickly.

What's Covered?
Long-term care insurance is designed to cover ongoing service needs at home or another facility, as well as other forms of support you may need legally, financially and socially. Support ranges from assistance for daily tasks (bathing, dressing and eating) to community daycare services to skilled care provided by nurses, therapists and other professionals. Medicare and Medicaid won't cover most of these costs until you have exhausted nearly all of your resources. That's why it's important to think about these issues long before you or a loved one needs this type of care.

Did You Know?

One in five adults ages 40 and older don't know if their private health insurance plan covers ongoing care in a nursing home, and more than 27% don't know if Medicare does.

Here's How to Plan AheadSwing into action early: Long-term care policies cost less if you buy them when you're younger and in good health. If you're older and you have a serious chronic illness or disability, it may be difficult to get coverage-or you may pay a lot more for it. Many financial advisers and insurance representatives recommend buying long-term care insurance in your fifties or early sixties.

Share your personal preferences: Talk to family members about what kind of living arrangements and care you might like if fully independent living is no longer possible. It's also important to choose someone who can make decisions on your behalf if necessary.

Look for flexibility: If you're married, consider buying a shared-benefit policy that will provide benefits that either spouse can use as needed. Or, choose a policy that blends long-term care insurance with life insurance: If you don't use the long-term care policy, your heirs will get that money when you die. In a pinch, some life insurance policies can also be sold to pay for long-term care.

Discuss your options with your Allstate Agent: Review your options every year in case you want to change your coverage. Also, since many people purchase a long-term care policy decades before they need it, consider opting for inflation protection, which increases your daily benefits by a fixed percentage of the original benefit amount to keep up with inflation.

Stay with it for the long haul: Once you buy long-term care insurance, don't stop paying the premiums! If you do, your policy will lapse and all the money that's been paid to date will be lost. Designate a family member or an advocate for the insurance company to contact for policy inquiries.

Tip

Read the fine print. Some long-term care policies will cover the costs of your long-term care for two to five years, while a select few will pay for it as long as you live, with no cap.